California Governor Signs Bills Impacting California Wage Suits

California Governor Signs Bills Impacting California Wage Suits

California Governor Jerry Brown signed two bills earlier this week intended to clarify California’s wage laws. The first of these bills, A.B. 2074, clarifies the statute of limitations to file suit for liquidated damages in relation to a violation of California’s minimum wage payment law. Specifically, existing law allows an employee to bring a civil lawsuit against an employer for the unpaid balance of wages/compensation owed to that individual, as well as to recover liquidated damages equal to unpaid wages plus interest in an action alleging payment less than California’s minimum wage. The recent bill goes one step further to clarify that the suit for liquidated damages may be filed at any time before the statute of limitation runs for the underlying claim of payment of less than the state minimum wage. The current statute of limitations for such a claim under California law is generally three years. The Bill Analysisassociated with A.B. 2074 suggests that the bill was needed to clarify the period to file suit for liquidated damages because at least one California Court of Appeal had found a one year statute of limitations for such claim.

The second of these bills, A.B. 2743, addresses employees working in the entertainment industry who, pursuant to Section 201.9 of the California Labor Code, work under a collective bargaining agreement mandating a time limit for the payment of wages after discharge or lay-off. The bill acknowledges that existing law imposes civil penalties against an employer who willfully fails to pay wages to a discharged or resigning employee in accordance with specific provisions of the Labor Code. Additionally, the law allows for employees to bring a civil action for such penalties. The section of the law allowing for such suit and civil penalties, however, failed to incorporate violations of Section 201.9. Accordingly, A.B. 2743 adds reference to Section 201.9 and extends the civil penalty and suit provisions to situations wherein an employer violates the time limit for payment of wages established pursuant to a collective bargaining agreement.

Koryn M. McHone is of counsel in the Labor and Employment Department in the firm’s Indianapolis, Indiana office. Ms. McHone represents management interests in employment litigation and providing employment counseling to employers of all sizes and with varying employment needs.